In April 2016 the Competition Board launched an investigation into Mey Içki, a subsidiary of Diageo plc. The investigation examined allegations of abuse of dominance in the Turkish vodka and gin markets.
The case handlers alleged that Mey Içki had allegedly engaged in exclusionary practices against competitors through rebate schemes, cash payment supports and visual arrangements at sales points.
On October 25 2017, after an 18-month investigation, the board found by unanimous vote that Mey Içki:
- held a dominant position in the vodka and gin markets;
- had violated Article 6 of Law 4054 with regard to the vodka and gin markets.
However, the board found by majority vote that Mey Içki had received an administrative fine for the same strategy in the raki (ie, a traditional Turkish spirit) market and held that there was no scope to impose additional administrative fines.
The Competition Board had already examined Mey Içki's alleged practices and imposed penalties in its raki decision of February 16 2017 (17-07/84-34). The alleged practices took place during the same period and the only significant difference between the two investigations was the products concerned.
Mey Içki established the investigation's lack of procedural and substantial grounds, emphasising the non bis in idem (ie, double jeopardy) principle and put forward economic arguments to strengthen its oral and written defences. It also argued that the investigation had been damaged by double jeopardy as:
- the Competition Authority had carried out a second investigation into the same alleged practices which had occurred at the same time; and
- the investigation had created the risk of repetitive fine.
The board found that there had been a violation through abuse of dominance but accepted the non bis in idem defence and concluded that Mey Içki should not be subject to an administrative fine under Article 16 of Law 4054.
While the reasoned decision is not yet available, the board acknowledged that the non bis in idem principle should be considered when rendering a second decision on the same allegations against the same firm concerning the same period, even if the relevant product market concerning the second decision is different than that examined in the first. Therefore, the above decision could set a landmark precedent regarding the interpretation of the non bis in idem principle under the Turkish competition law regime. The reasoned decision, which is expected to be published in the following months, is likely to provide insight into the direction that Turkish competition enforcement will take in the coming years with regard to the non bis in idem principle.
The objectivity of the Competition Authority's investigation is commendable in light of the explanations and defences that Mey Içki presented and the compliance programme that it followed internally. Pending issuance of the reasoned decision, the initial decision confirms the authority's approach to the non bis in idem principle under Turkish competition law.
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